The European Crisis and the role of the financial system

Vítor Constancio

No 15, Special Conference Papers from Bank of Greece

Abstract: The paper aims to provide a deep rationale for banking union in the Euro Area. It shows that the banking sectors of core and peripheral countries were responsible for financing the credit boom that created the imbalances and vulnerabilities that later were at the centre of the crisis. The increase of debt ratios in the periphery until 2007 was more significant for the private sector than for the public sector. The crisis has been as much a banking crisis as a sovereign debt crisis and to avoid similar future risks a European Supervisor and a Resolution Authority are essential.

Keywords: European crisis; banking union; fiscal and macroeconomic imbalances (search for similar items in EconPapers)
JEL-codes: E52 F36 G01 H63 (search for similar items in EconPapers)
Pages: 24
Date: 2013-07
New Economics Papers: this item is included in nep-cba, nep-ias, nep-mac and nep-opm
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Citations: View citations in EconPapers (4)

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Journal Article: The European Crisis and the Role of the Financial System (2014)
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